Charter targets $2 billion cost cuts as cable and broadband pressures weigh on growth

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Charter targets $2B cost cuts

Highlights

Charter will cut $2 billion in annualized operating costs over 18 months and refocus marketing for its internet service, targeting improved retention via mobile and video products.
Third-quarter revenue was $14.9 billion versus LSEG consensus of $15.03 billion, with a net loss of $20.50 per share driven by a $6.3 billion franchise impairment charge.
Charter lost 233,000 internet customers in Q3 versus 171,000 a year ago, and shares fell over 5% in premarket trading, deepening a 39.7% YTD decline.

Restructuring plan and third-quarter performance

As reported by Reuters, Charter said on Friday it will cut $2 billion in annualized operating costs over the next 18 months while reworking how it markets and sells its core internet service. The company says it will rely more on its mobile and video products to add customers and improve retention.

The savings come in addition to more than $1 billion in anticipated synergies from Charter's acquisition of Cox Communications, which closed on August 19. The $34.5 billion deal, including debt, combined two of the largest U.S. cable and broadband operators as they compete more aggressively for subscribers.

Charter also reported third-quarter revenue of $14.9 billion, below analysts' average estimate of $15.03 billion, according to LSEG data. It posted a net loss of $20.50 per share, compared with income of $8.50 a year earlier, driven mainly by a $6.3 billion franchise impairment charge.

Customer losses and competitive pressure

Charter's core businesses remain under pressure as streaming services and wireless carriers continue to target its customer base. Its cable TV operations face competition from platforms such as Netflix and Disney+, while broadband rivals including Verizon and T-Mobile are using fixed wireless offerings to win home internet subscribers.

On a pro forma basis, Charter lost 233,000 internet customers in the third quarter, compared with a loss of 171,000 a year earlier. Video customers fell by 77,000, an improvement from a decline of 121,000 in the same period last year.

Investors reacted negatively to the update, with Charter shares falling more than 5% in premarket trading. The stock had already declined 39.7% this year through Thursday's close, while the company ended September with total debt of $108.6 billion and cash of $573 million.

Our earlier article on the Nasdaq 100’s decline highlighted how the index slid even as upbeat results and continued AI enthusiasm failed to reverse broader sell-side pressure. We noted the benchmark was trading below key short- and medium-term moving averages, with analysts focusing on whether it could hold near-term support or risk a deeper pullback.

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